Casella Waste Systems releases third quarter results
Casella Waste Systems, Inc., a regional vertically-integrated solid waste, recycling and resource management services company, reported financial results for its third quarter fiscal year 2012, and provided updated guidance for its 2012 fiscal year.
Highlights for the quarter included:
- Revenue growth of 2.6 percent over the same quarter last year.
- Overall solid waste pricing growth of 0.8 percent was primarily driven by collection pricing growth of 2.1 percent as a percentage of collection revenues.
- Adjusted EBITDA was $22.2 million for the quarter, down $0.2 million from same quarter last year.
For the quarter ended January 31, 2012, revenues were $114.6 million, up $3.0 million or 2.6 percent from the same quarter last year. Operating income was $4.4 million for the quarter, down $1.9 million from the same quarter last year. The company’s net loss attributable to common shareholders was ($24.6) million, or ($0.92) per common share for the quarter, compared to a net loss of ($6.4) million, or ($0.24) per share for the same quarter last year.
US GreenFiber LLC incurred a ($10.2) million non-cash goodwill impairment charge during the quarter. The company’s 50 percent share of this charge was recorded as a ($5.1) million pre-tax charge to loss from equity method investments. The company also recognized a ($10.7) million non-cash impairment of equity method investment charge during the quarter to write down the book value of its investment in US GreenFiber.
“Most of the core fundamentals of the business were positive in the quarter, with higher collection pricing, improving landfill volumes, and continued customer adoption of Zero-Sort® Recycling services driving higher recycling volumes,” said John W. Casella, chairman and CEO of Casella Waste Systems. “However, lower energy prices and weaker recycling commodity prices were a significant offset to our fundamental strengths.”
“As a result of the sharp drop in natural gas prices in the late fall, energy prices fell over $30 per megawatt hour at our waste-to-energy facility, leading to a $1.4 million decline in operating income year-over-year,” Casella said. “Recycling commodity prices also declined last quarter, with commodity prices down 13 percent year-over-year and down 25 percent from our second quarter to third quarter. While our hedging strategies worked as expected and absorbed much of the pricing pressure, the lower prices negatively impacted operating income by $0.7 million year-over-year. Commodity prices have rebounded from the December lows, but we still expect pricing comparisons to remain negative for the next 2 to 3 quarters.”